DOJ Alleges Gotbit Founder Made 'Tens of Millions' on Wire Fraud in Indictment

The U.S. Department of Justice (DOJ) has indicted the founder and CEO of cryptocurrency “market maker” Gotbit on charges of wire fraud and conspiracy to commit market manipulation and wire fraud.

According to a DOJ press release, Aleksei Andriunin was charged in a superseding indictment, which also charged Gotbit and his fellow co-founders Fedor Kedrov and Qawi Jalili, who were previously charged in an October 9 indictment.

Founder of cryptocurrency financial services firm “Gotbit” indicted for market manipulation and fraud conspiracy. Allegedly made tens of millions of dollars in proceeds for fraudulent “wash trading” services.
🔗https://t.co/d0ofGJkACz

— U.S. Attorney Massachusetts (@DMAnews1) October 31, 2024

Prosecutors allege that between 2018 and 2024, when Andriunin was CEO of Gotbit, the firm artificially inflated the trading volume of cryptocurrencies through “wash trading” in order to get them listed on crypto price aggregator site CoinMarketCap, as well as on crypto exchanges.

Andriunin is alleged to have made millions of dollars providing wash trading services for cryptocurrencies, transferring the proceeds into his personal Binance account. Gotbit’s clients allegedly included meme coins Robo Inu and Saitama, whose leadership were charged separately in the October 9 indictment.

At the time, federal prosecutors revealed that they had charged Gotbit alongside crypto firms ZM Quant, CLS Global, and MyTrade and other companies, arresting four, securing plea agreements by five individuals and seizing over $25 million in cryptocurrency.

“These are cases where an innovative technology—cryptocurrency—met a century-old scheme—the pump and dump,” Acting United States Attorney Joshua Levy said in a statement last month. He added: “Wash trading has long been outlawed in the financial markets, and cryptocurrency is no exception.”

Andriunin faces a maximum possible sentence of 20 years on wire fraud charges, while the lesser charges of conspiracy each carry sentences of up to five years.

In sponsored posts on crypto news sites, Gotbit had previously argued that meme coins could bring new companies into the crypto space, with Andriunin calling meme coins “the bridge to onboard Web2 audiences to crypto.”

Edited by Stacy Elliott.